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MOTION AND MEMORANDUM OF
THE UNITED STATES IN SUPPORT OF ENTRY OF FINAL JUDGMENT

Pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act, 15 U.S.C.§ 16(b)-(h) ("APPA"), plaintiffs, the United States of America ("United States") and the State of
Missouri and the State of Nebraska ("the states"), move for entry of the proposed Final Judgment
filed in this civil antitrust proceeding. The proposed Final Judgment may be entered at this time
without further hearing if the Court determines that entry is in the public interest. The
Competitive Impact Statement ("CIS"), filed in this matter on January 20, 2010, explains why
entry of the proposed Final Judgment would be in the public interest. The Plaintiffs are filing
simultaneously with this Motion and Memorandum a Certificate of Compliance setting forth the
steps taken by the parties to comply with all applicable provisions of the APPA and certifying
that the statutory waiting period has expired.

I.Background

On November 30, 2009, Plaintiffs filed a civil antitrust Complaint alleging that the
proposed acquisition of MedServe, Inc. by Stericycle, Inc. would substantially lessen competition
in the provision of infectious waste collection and treatment services for large quantity generator
("LQG") customers in the states of Kansas, Missouri, Nebraska, and Oklahoma, in violation of
Section 7 of the Clayton Act, 15 U.S.C. § 18, as amended.

Infectious waste is one of three types of regulated medical waste. Infectious waste is
waste that comes into contact with bodily fluids and "sharps" waste, such as syringes and
scalpels. The other two are pathological waste, which is anatomical parts, and trace
chemotherapy, which are small amounts of chemical compounds used to treat cancer patients and
the equipment used to administer the compounds. Infectious waste comprises approximately 90
percent of the regulated medical waste generated in the United States. State and federal
governments heavily regulate the collection and treatment of regulated medical waste.

LQG customers typically are hospitals, large laboratories and other large medical
facilities that generate large amounts of infectious waste, and LQG customers require that service
providers must be capable of collecting and treating large amounts of infectious waste on a daily
basis. In addition, providers must meet strict standards to ensure that they have sufficient
technical capability, knowledge, and financial resources to minimize the possibility that the waste
might be mishandled and provide substantial liability insurance in the event of an accident.

The complaint alleges that Stericycle and MedServe are each other's only rival for the
provision of infectious waste collection and treatment services to LQG customers in Kansas,
Missouri, Nebraska, and Oklahoma. The Complaint further alleges that, if Stericycle's proposed
acquisition of MedServe were to occur, Stericycle would become the monopoly provider of
infectious waste collection and treatment services for LQG customers in these states.
Accordingly, the complaint sought to permanently enjoin the proposed acquisition by requesting
a judgment that the acquisition violated Section 7 of the Clayton Act.

At the same time the Complaint was filed, the United States filed a Hold Separate
Stipulation and Order ("Hold Separate Order") and a proposed Final Judgment, which are
designed to eliminate the anticompetitive effects of the acquisition, and a CIS. The Court signed
and entered the Hold Separate Order on December 1, 2009. The proposed Final Judgment
requires Stericycle, within 90 days after the filing of the Complaint, or five days after notice of
the entry of the Final Judgment by the Court, whichever is later, to divest the assets currently
used by MedServe in the provision of infectious waste collection and treatment services to LQG
customers in Kansas, Missouri, Nebraska, and Oklahoma ("Divestiture Assets") to an acquirer
acceptable to the United States in its sole discretion after consultation with the states. (1) Under the
terms of the proposed Final Judgment, if Stericycle has not sold the Divestiture Assets within the
prescribed time, this Court would appoint a trustee to sell the Divestiture Assets. The Hold
Separate Order and the proposed Final Judgment required Stericycle to preserve, maintain and
continue to operate the Divestiture Assets in the ordinary course of business, including
reasonable efforts to maintain and increase sales and revenues. The CIS explains the basis for
the Complaint and the reasons why entry of the proposed Final Judgment would be in the public
interest.

The Hold Separate Order provides that the proposed Final Judgment may be entered by
the Court after the completion of the procedures required by the APPA. Entry of the proposed
Final Judgment would terminate this action, except that the Court would retain jurisdiction to
construe, modify, or enforce the provisions of the proposed Final Judgment and to punish
violations thereof.

II.Compliance with the APPA

The APPA requires a sixty-day period for the submission of public comments on a
proposed Final Judgment. See 15 U.S.C. § 16(b). In compliance with the APPA, the United
States filed the CIS on January 20, 2010; published the proposed Final Judgment and CIS in the Federal Register on February 1, 2010(see United States, et al. v. Stericycle, Inc., et al, 75 Fed.
Reg. 5120); and published summaries of the terms of the proposed Final Judgment and CIS,
together with directions for the submission of written comments relating to the proposed Final
Judgment, in TheWashington Post for seven days beginning on February 7, 2010 and ending on
February 13, 2010. The sixty-day public comment period terminated on April 14, 2010; the
United States received no public comments. Simultaneously with this Motion and
Memorandum, the United States is filing a Certificate of Compliance that states all the
requirements of the APPA have been satisfied. It is now appropriate for the Court to make the
public interest determination required by 15 U.S.C. § 16(e) and to enter the proposed Final
Judgment.

III.Standard of Judicial Review

The Clayton Act, as amended by the APPA, requires that proposed consent judgments in
antitrust cases brought by the United States be subject to a sixty-day comment period, after which
the court shall determine whether entry of the proposed Final Judgment "is in the public
interest." 15 U.S.C. § 16(e)(1). In making that determination in accordance with the statute, the
court is required to consider:

(A) the competitive impact of such judgment, including termination of alleged
violations, provisions for enforcement and modification, duration of relief
sought, anticipated effects of alternative remedies actually considered,
whether its terms are ambiguous, and any other competitive considerations
bearing upon the adequacy of such judgment that the court deems
necessary to a determination of whether the consent judgment is in the
public interest; and

(B) the impact of entry of such judgment upon competition in the relevant
market or markets, upon the public generally and individuals alleging
specific injury from the violations set forth in the complaint including
consideration of the public benefit, if any, to be derived from a
determination of the issues at trial.

15 U.S.C. § 16(e)(1)(A)-(B). In considering these statutory factors, the court's inquiry is
necessarily a limited one as the government is entitled to "broad discretion to settle with the
defendant within the reaches of the public interest." United States v. Microsoft Corp., 56 F.3d
1448, 1461 (D.C. Cir. 1995); see generally United States v. SBC Commc'ns, Inc., 489 F. Supp.
2d 1 (D.D.C. 2007) (assessing public interest standard under the Tunney Act); United States v.
InBev N.V./S.A., 2009-2 Trade Cas. (CCH) ¶76,736, No. 08-1965 (JR), 2009 U.S. Dist. LEXIS
84787, at *3 (D.D.C. Aug. 11, 2009) (noting that the court's review of a consent judgment is
limited and only inquires "into whether the government's determination that the proposed
remedies will cure the antitrust violations alleged in the complaint was reasonable, and whether
the mechanism to enforce the final judgment are clear and manageable.").

As the United States Court of Appeals for the District of Columbia has held, under the
APPA a court considers, among other things, the relationship between the remedy secured and
the specific allegations set forth in the government's complaint, whether the decree is sufficiently
clear, whether enforcement mechanisms are sufficient, and whether the decree may positively
harm third parties. See Microsoft, 56 F.3d at 1458-62. With respect to the adequacy of the relief
secured by the decree, a court may not "engage in an unrestricted evaluation of what relief would
best serve the public." United States v. BNS, Inc., 858 F.2d 456, 462 (9th Cir. 1988) (citing United States v. Bechtel Corp., 648 F.2d 660, 666 (9th Cir. 1981)); see alsoMicrosoft, 56 F.3d at
1460-62; United States v. Alcoa, Inc., 152 F. Supp. 2d 37, 40 (D.D.C. 2001); InBev, 2009 U.S.
Dist. LEXIS 84787, at *3. Courts have held that:

[t]he balancing of competing social and political interests affected by a proposed
antitrust consent decree must be left, in the first instance, to the discretion of the
Attorney General. The court's role in protecting the public interest is one of
insuring that the government has not breached its duty to the public in consenting
to the decree. The court is required to determine not whether a particular decree is
the one that will best serve society, but whether the settlement is "within the
reaches of the public interest." More elaborate requirements might undermine the
effectiveness of antitrust enforcement by consent decree.

Bechtel, 648 F.2d at 666 (emphasis added) (citations omitted). (2) In determining whether a
proposed settlement is in the public interest, the court "must accord deference to the
government's predictions about the efficacy of its remedies, and may not require that the
remedies perfectly match the alleged violations." SBC Commc'ns, 489 F. Supp. 2d at 17; see
alsoMicrosoft, 56 F.3d at 1461 (noting the need for courts to be "deferential to the government's
predictions as to the effect of the proposed remedies"); United States v. Archer-Daniels-Midland
Co., 272 F. Supp. 2d 1, 6 (D.D.C. 2003) (noting that the court should grant due respect to the
United States's prediction as to the effect of proposed remedies, its perception of the market
structure, and its views of the nature of the case).

Courts have greater flexibility in approving proposed consent decrees than in crafting
their own decrees following a finding of liability in a litigated matter. "[A] proposed decree must
be approved even if it falls short of the remedy the court would impose on its own, as long as it
falls within the range of acceptability or is 'within the reaches of public interest.'" United States
v. Am. Tel. & Tel. Co., 552 F. Supp. 131, 151 (D.D.C. 1982) (citations omitted) (quoting United
States v. Gillette Co., 406 F. Supp. 713, 716 (D. Mass. 1975)), aff'd sub nom. Maryland v.
United States, 460 U.S. 1001 (1983); see alsoUnited States v. Alcan Aluminum Ltd., 605 F.
Supp. 619, 622 (W.D. Ky. 1985) (approving the consent decree even though the court would
have imposed a greater remedy). Therefore, the United States "need only provide a factual basis
for concluding that the settlements are reasonably adequate remedies for the alleged harms." SBC Commc'ns, 489 F. Supp. 2d at 17.

Moreover, the court's role under the APPA is limited to reviewing the remedy in
relationship to the violations that the United States has alleged in its Complaint, and does not
authorize the court to "construct [its] own hypothetical case and then evaluate the decree against
that case." Microsoft, 56 F.3d at 1459; see also InBev, 2009 U.S. Dist. LEXIS 84787, at *20
("the 'public interest' is not to be measured by comparing the violations alleged in the complaint
against those the court believes could have, or even should have, been alleged"). Because the
"court's authority to review the decree depends entirely on the government's exercising its
prosecutorial discretion by bringing a case in the first place," it follows that "the court is only
authorized to review the decree itself," and not to "effectively redraft the complaint" to inquire
into other matters that the United States did not pursue. Microsoft, 56 F.3d at 1459-60. Asthis
Court confirmed in SBC Communications, courts "cannot look beyond the complaint in making
the public interest determination unless the complaint is drafted so narrowly as to make a
mockery of judicial power." 489 F. Supp. 2d at 15.

In its 2004 amendments to the Tunney Act, (3) Congress made clear its intent to preserve the
practical benefits of utilizing consent decrees in antitrust enforcement, stating: "[n]othing in this
section shall be construed to require the court to conduct an evidentiary hearing or to require the
court to permit anyone to intervene." 15 U.S.C. § 16(e)(2). The language wrote into the statute
what Congress intended when it enacted the Tunney Act in 1974, as Senator Tunney explained:
"[t]he court is nowhere compelled to go to trial or to engage in extended proceedings which
might have the effect of vitiating the benefits of prompt and less costly settlement through the
consent decree process." 119 Cong. Rec. 24,598 (1973) (statement of Senator Tunney). Rather,
the procedure for the public interest determination is left to the discretion of the court, with the
recognition that the court's "scope of review remains sharply proscribed by precedent and the
nature of Tunney Act proceedings." SBC Commc'ns, 489 F. Supp. 2d at 11. (4)

Plaintiffs alleged in their Complaint that the acquisition of MedServe by Stericycle
would substantially lessen competition in the provision of infectious waste collection and
treatment services for LQG customers in the states of Kansas, Missouri, Nebraska, and
Oklahoma. The remedy in the proposed Final Judgment resolves the alleged competitive effects
entirely by requiring Stericycle to divest the Divestiture Assets to a viable purchaser approved by
the United States after consultation with the states. Moreover, the public, including affected
competitors and customers, has had the opportunity to comment on the proposed Final Judgment
as required by law, and no comments have been submitted. There has been no showing that the
proposed settlement constitutes an abuse of the United States's discretion or that it is not within
the zone of settlements consistent with the public interest.

IV.Conclusion

For the reasons set forth in this Motion and Memorandum and in the CIS, the Court
should find that the proposed Final Judgment is in the public interest and should enter the Final Judgment without further hearings. The United States respectfully requests that the Final
Judgment attached hereto be entered as soon as possible.

1. The defendants are scheduled to complete the divestiture of the Divestiture Assets on
May 1, 2010.

2. Cf. BNS, 858 F.2d at 464 (holding that the court's "ultimate authority under the
[APPA] is limited to approving or disapproving the consent decree"); United States v. Gillette
Co., 406 F. Supp. 713, 716 (D. Mass. 1975) (noting that, in this way, the court is constrained to
"look at the overall picture not hypercritically, nor with a microscope, but with an artist's
reducing glass"). See generally Microsoft, 56 F.3d at 1461 (discussing whether "the remedies
[obtained in the decree are] so inconsonant with the allegations charged as to fall outside of the
'reaches of the public interest'").

4. See United States v. Enova Corp., 107 F. Supp. 2d 10, 17 (D.D.C. 2000) (noting
that the "Tunney Act expressly allows the court to make its public interest determination on the
basis of the competitive impact statement and response to comments alone"); United States v.
Mid-Am. Dairymen, Inc., 1977-1 Trade Cas. (CCH) ¶ 61,508, at 71,980 (W.D. Mo. 1977)
("Absent a showing of corrupt failure of the government to discharge its duty, the Court, in
making its public interest finding, should . . . carefully consider the explanations of the
government in the competitive impact statement and its responses to comments in order to
determine whether those explanations are reasonable under the circumstances."); S. Rep. No.
93-298, 93d Cong., 1st Sess., at 6 (1973) ("Where the public interest can be meaningfully
evaluated simply on the basis of briefs and oral arguments, that is the approach that should be
utilized.").